JUDGMENT :

N.ANAND VENKATESH, J.

This appeal has been filed under Section 37 of the “Arbitration and Conciliation Act, 1996” (for brevity hereinafter referred to as “the Act”), against the order dated 12.02.2021 passed by the Principal District Judge, Tiruchirappalli, in Arbitration O.P. No. 11 of 2018, dismissing the petition and confirming the award passed by the Sole Arbitrator dated 30.04.2018.

2. The respondent who is the claimant was a successful tenderer on a tender floated by the appellant for the construction of Phase-I of the Hospital Complex, Medical College Block and other ancillary blocks. Under Letter of Intent dated 02.07.2009, the work was allotted to the claimant at the cost of Rs.86.50 crores. The work was to be executed within a period of 12 months from the date of handing over of the site.

3. The further case of the claimant is that, by separate contracts, the appellant gave the electrical and plumbing works to the claimant under Letters of Intent dated 16.12.2009 and 19.03.2010, respectively. An architect was appointed for the purpose of providing the drawings and work had to be executed as per the approved drawings and the final bill that is submitted had to be certified by the architect.

4. There was no issue till the certification and payment of 17 running bills. Thereafter, the architect stopped certifying the bills and even for the additional works done by the claimant, the payment was not forthcoming. The work was completed as early as on 30.08.2011 and it was informed by the claimant to the appellant on 08.09.2011. The final bill was submitted on 15.12.2011. Since the payment was not made, a trigger notice under Section 21 of the Act was issued on 08.11.2012. Thereafter various negotiations took place but the appellant denied the claims made by the respondent. Hence, an application came to be filed under Section 11 of the Act before this Court in O.P. No. 645 of 2016 and by order dated 18.07.2016, the Arbitral Tribunal was constituted.

5. The respondent/claimant filed the claim petition and made the following claims:

PRAYER

It therefore prayed that this Hon'ble Tribunal may be pleased to pass an award directing the Respondent to pay a sum of Rs.45,24,89,232/- including the interest at 18% per annum on the principal sum of Rs.22,33,19,138/- along with cost and pass such other suitable order as this Hon'ble Tribunal may deem fit and proper on the facts and circumstances of the case.

6. The appellant filed the statement of defence and took a stand that it was a lumpsum contract for a total sum of Rs.77 crores and out of the same nearly Rs.70 crores was paid and if at all there was any balance amount due and payable, it is only Rs.7 crores. Certification was not done by the Architect since the work was not completed. The additional amount claimed by the respondent/claimant did not even form part of the final bill that was submitted and all of the sudden it was included in the claim statement without any basis. Accordingly, the appellant sought for the rejection of the claim petition.

7. The Sole Arbitrator on considering the pleadings, framed the following issues;

“a) Whether the contract awarded to the Claimant is a lump sum contract or Bill of Quantities on re-measureable contract?

b) Whether the Claimant's entitlement on payment is based on the final measurement of work executed?

c) Whether the Claimant had executed the job as per the instructions of the Respondent's architects as mandated under the contract?

d) Whether the claimant was deficient in performing any of the services that it was liable to perform under the Tender Document dated 20.05.2009 and the LOI dated 02.07.2009?

e) Whether the Claimant is entitled for amount duly certified by the architects as mandated under the contract which includes the Extra items?

f) Whether Respondent has made all the payments as per the Certification of the Architect?

g) Whether the Respondent is right in withholding the Retention amount?

h) Whether the letter of Invocation o